My Cash Cow

[RebeccaBryan]

The first property I ever bought was an up-down duplex in Killarney. It`s a two storey. The main suite has 5 bedrooms and two full baths, the basement suite has 2 bedrooms and one bath. It`s huge. The main suite is 1700 square feet. Anyway, when I first bought it in Feb/06 I rented the entire house to a family for $1550. One year later I raised the rent from $1550 to $2400 just to get rid of them because they were such pigs. I`m betting you wouldn`t have found a messier yard in Edmonton! Anyway, in January/08 she finally gave me notice that she had found another place. YEAH!!!

My success story not only incudes getting rid of my messy tenant, but as well, I am now renting the main 5 bedroom suite for $1875/mo., the garage for $100/mo. and the 2 bedroom basement suite for $1100/mo. all plus utilites. That`s $3075/mo.! I`ve refinanced the property twice, so it`s only making $1400 cash flow.

My other success story for the day is, I convinced my son Reegan to refinance his 1/2 duplex and buy a rental property here in Edmonton. I just rented it yesterday to two young Calgary girls. The property is in Rundle Heights, it`s a 4 bedroom, 1.5 bath and I rented it for $1575. I know, I know, it`s fantastic for that area!

From my personal experience, the properties I have that are in areas that have mostly rental units, (like streets with all duplexes, or condo complexes with many rentals), rent easier that the properties we have in areas that are mostly home owners/personal residences. I`m not sure why that is.

Just a tip, don`t be afraid to be agressive in your rents. Make sure your units are in top condition and not only will they be easy to rent but you will be able to get top dollar.

One more thing. I rented Reegans Condo from an ad on gottarent, I rented my duplex basement suite from a sign in front, and the upstairs was an existing tenant I had in another property.

Cheers everyone!

 

[RedlineBrett]

Hi Rebecca,

Great story! Congrats on the little money maker! We have one we just closed on two months ago that ALMOST falls in line with " the 1% rule" if you can believe it

Really enjoy your `in the trenches` posts on property management. Thanks for posting

BT

QUOTE (RebeccaBryan @ Apr 12 2008, 05:35 AM) The first property I ever bought was an up-down duplex in Killarney. It`s a two storey. The main suite has 5 bedrooms and two full baths, the basement suite has 2 bedrooms and one bath. It`s huge. The main suite is 1700 square feet. Anyway, when I first bought it in Feb/06 I rented the entire house to a family for $1550. One year later I raised the rent from $1550 to $2400 just to get rid of them because they were such pigs. I`m betting you wouldn`t have found a messier yard in Edmonton! Anyway, in January/08 she finally gave me notice that she had found another place. YEAH!!!

My success story not only incudes getting rid of my messy tenant, but as well, I am now renting the main 5 bedroom suite for $1875/mo., the garage for $100/mo. and the 2 bedroom basement suite for $1100/mo. all plus utilites. That`s $3075/mo.! I`ve refinanced the property twice, so it`s only making $1400 cash flow.

My other success story for the day is, I convinced my son Reegan to refinance his 1/2 duplex and buy a rental property here in Edmonton. I just rented it yesterday to two young Calgary girls. The property is in Rundle Heights, it`s a 4 bedroom, 1.5 bath and I rented it for $1575. I know, I know, it`s fantastic for that area!

From my personal experience, the properties I have that are in areas that have mostly rental units, (like streets with all duplexes, or condo complexes with many rentals), rent easier that the properties we have in areas that are mostly home owners/personal residences. I`m not sure why that is.

Just a tip, don`t be afraid to be agressive in your rents. Make sure your units are in top condition and not only will they be easy to rent but you will be able to get top dollar.

One more thing. I rented Reegans Condo from an ad on gottarent, I rented my duplex basement suite from a sign in front, and the upstairs was an existing tenant I had in another property.

Cheers everyone!

 

[Kimberly]

Rebecca:

Thanks for always sharing your inside tips and learnings. I enjoy and respect your perspectives and mentally file them for possible future use.

 

[lucyb]

Hi,
I`m interested in RE investing, but not a member yet--am reading the (quite fabulous) postings at myreinspace, to test the water.
What in heck is the 1% rule? Also, I`ve read several mentions of something to do with an 8% rule too; what does that mean? If this is too basic a question, could you refer me to a post that explains it? Thank you.
Lucy Becker

 

[DonCampbell]

Hi Rebecca,

You teach us all a very important lesson. The rental market in Edmonton is on fire (April 2008) and many landlords are incredibly under-pricing their units and thus underpricing their investments.

There is no harm being near the top of the market, as long as your property warrants it, because it works as a great filter. Sure you get less calls, but you get more serious calls.

Everytime a rookie landlord reduces their rent, or they under-price their rents, they immediately show that they are not paying attention to the market realities and therefore are forcing their investments to under-perform. This hurts them upon refinance, it hurts them on their cash flow and can negatively affect their ability to get financing to buy more properties... all because they didn`t manage their properties like sophisticated investors do.

Congrats Rebecca

 

[RebeccaBryan]

Thank you Don,

Tonight I just put an offer on another up-down duplex about 5 houses down from "My Cash Cow". It`s been on the market for about 2 months. I crunched the numbers and it works. We`ll see if the seller is motivated enough to sell it to me for the price I want. I`m hoping to get a deal, but I`m willing to pay what he`s asking as he has the rents set at what will meet an 8% solution at the price he`s asking. I`m hoping for a September closing. The sellers agent is suggesting he will have no problem with that, so I`m anxiously awaiting what we can negotiate.

 

[RedlineBrett]

QUOTE (RebeccaBryan @ Apr 27 2008, 12:05 AM) Thank you Don,

Tonight I just put an offer on another up-down duplex about 5 houses down from "My Cash Cow". It`s been on the market for about 2 months. I crunched the numbers and it works. We`ll see if the seller is motivated enough to sell it to me for the price I want. I`m hoping to get a deal, but I`m willing to pay what he`s asking as he has the rents set at what will meet an 8% solution at the price he`s asking. I`m hoping for a September closing. The sellers agent is suggesting he will have no problem with that, so I`m anxiously awaiting what we can negotiate.


Good luck! Funny you mention that - I spent some time this afternoon pricing out a property close to one of our best units. I like to keep our stuff concentrated if I can

 

[Mitch Collins]

Hi Rebecca!

Your 1st duplex sounds a lot like mine in FSJ - numbers are quite similar!

All these posts I`m reading lately make me feel really good about the BRAND NEW strata titled duplexes we`re buying in Fort St. John. At reasonable rents, with what I`ve negotiatied for a price, they sit at about 8.54% per 1/2 duplex with no illegal or non conforming suites.

It sure is getting harder to find good cash flow!

Regards

Mitch